Ann Taylor sues after Guess retail deal on West 34th Street blocked

By Adam Pincus | June 18, 2010 05:30PM

The Ann Taylor space at 31 West 34th Street

Retailer Ann Taylor Stores filed a $10 million lawsuit against its landlord at 31 West 34th Street, alleging that the landlord is blocking it from turning its lease over to retailer Guess, court records show.

Ann Taylor, based in Manhattan, claimed in a lawsuit filed in New York State Supreme Court Monday that the landlord Dis NY, LLC, would not consent to the transfer of the lease to Los Angeles-based retailer Guess.

The lease for 11,136 square feet of ground floor retail and about 3,000 square feet of basement space in the building located on the north side of 34th Street between Fifth and Sixth avenues expires in 2017 with an option to renew to 2022, the court filing shows.

Ann Taylor and Guess struck an agreement in April 2010 to transfer the sublease to Guess, but Dis NY refused to provide its consent, which is required for the deal to go forward, the court papers said.

The deal between Ann Taylor and Guess called for Ann Taylor vacating the space in July, court documents show, but Dis NY never gave its consent. Ann Taylor remains in the store.

Dis NY controls the property through a master lease with the owner of the property, an entity called 31 West 34th Street LLC, court records indicate.

The lawsuit says it was “unreasonable” for Dis NY to withhold its consent and is seeking a court order forcing the landlord to approve the lease transfer. In addition, the company is seeking $10 million in compensatory and punitive damages for violating terms of the lease, the filing says.

A spokesperson for Ann Taylor said it was the company’s policy not to comment on pending litigation. Guess and Dis NY did not immediately respond to a request for comment.